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Biotech / Medical : Cor Therapeutics Inc. (CORR) -- Ignore unavailable to you. Want to Upgrade?

To: Biomaven who wrote (356)	1/31/1999 12:41:00 AM
From: Robohogs	Read Replies (2) \| Respond to of 712

First: Full disclosure I own both COR and CNTO. Second: COR and MRK are currently (notice I say currently) losing the battle. CORR's and MRK's sales came to $20 mm combined vs. $108 million for Centocor. This equates to just shy of 85% market share for CNTO and for 6.5% for CORR. Looking at growth in the market, the market totalled $80 million during 4th quarter 1997. So total market increased by $50 million or so with the leader (CNTO) taking 60% of new sales and newcomers 40%. Given CNTO's pricing being 1.5-2x higher, on a volume basis, COR and MRK likely took over half of all "new" (i.e., growth over 1997) treatments in terms of volume. The key takeaways are that CORR is now beginning to ramp nicely, that MRK growth is slowing relative to CORR and that CNTO will ultimately likely remain the leader in the market (at least for the next few years). The CNTO bears/CORR bulls at one point expected Reopro to nose dive post CORR approval. Obviously, even taking seasonality into account, Reopro is annualizing at about $400 million (4th quarter usually more than 1/4 of sales due to snow heart attacks). Based on guidance from CORR/CNTO, growth in overall market should slow in 1999 with total CNTO sales of $450 million or so, up 25% or so from $360 million reported sales in 1997. CORR/MRK will likely take $50-75 million each leading to a bullish case market size of $600 million (75% CNTO, 13% MRK and 12% CORR - I have to assume MRK will hold slight lead). On a volume basis, assuming 1.5x higher Reo pricing, CNTO would have 67% share to 17% and 16% shares for MRK and CORR. Now here is where the market is short-sighted. CORR will likely do $70 million end-user sales in 1999. This should grow to $150-200 million by 2001. Ramp is slower than expected, but from a small base, this will ultimately be good for CORR. The main risk is that the slow ramps give CNTO chance to catch up on labelling. My guess is that at end of day, 2001 will see CNTO at $600-650 million, CORR at $200 million and MRK at $150 million, roughly 19% of the market shifting to CORR/ MRK versus the 1999 revenue split. This is similar to market shares in other drug categories for the first to market guys. The big CNTO ramp will be in 2001 as indication is broadened in 2002.